RALEIGH – A couple of weeks ago, I devoted my syndicated column to the issue of how President Obama’s health care plan would affect the finances of the state of North Carolina. Because whatever might eventually come out of Congress would include a massive increase in Medicaid eligibility, I argued, North Carolina taxpayers would be out hundreds of millions of dollars, both in state and federal taxes.
Shortly after the column appeared across the state, the U.S. House voted on health care legislation. While the bill narrowly passed, a majority of North Carolina’s delegation – including all five Republicans and three of the eight Democrats – voted against it.
I think it was my Medicaid argument that tipped the balance for these North Carolina reps.
OK, maybe that’s stretching it just a bit. But the state-budget implications of ObamaCare are hardly a stretch. They are very real. While there are other good arguments against Washington’s power grab over the markets for health insurance and medical care, the prospect of socking North Carolina and other cash-strapped state governments with additional fiscal burdens is certainly one that can capture the attention of moderates and even a few sensible liberals who’d rather devote state tax dollars to longtime state priorities such as public education.
So please allow me revise and extend my remarks a bit. Or, more to the point, let me cite the remarks of the Heritage Foundation’s Dennis Smith, who drove this point home on the Foundry blog last week:
By expanding Medicaid in the health care bill, Congress will set off political tornadoes across the country that will leave governors and state legislators to clean up afterward. The math is simple. State revenues are still in a slump and will continue for a least a few more years. The two largest state and local expenditures are education and Medicaid. If you have a balance a budget, which nearly every state does, and you cannot touch the entitlement to Medicaid, where will you turn to fill the budget gap? There will be little choice than to go after education.
The argument is likely to persuade more lawmakers in the Senate than it did in the House:
There are more former governors serving in the U.S. Senate than in the U.S. House of Representatives which means the Senate should be more aware of the Medicaid vs Education cage match. When legislation gets to the Senate floor, it will be interesting to watch whether the “former governor caucus” will work together across party lines to protect all states or only their own.
The time-honored tradition of Congress would be to feign concern about the states’ predicament, toss a few fiscal crumbs their way, and then promise some future alleviation of unfunded mandates. Some governors and state legislators may just be gullible enough to fall for it.
The more-sensible ones need to let their federal representatives know that a vote to expand Medicaid is a vote to expand the size, scope, and cost of state government – a vote that North Carolinians won’t look upon with favor.
Hood is president of the John Locke Foundation